A construction employment agreement, or a detailed offer letter, should put in writing your pay, the bonus formula, severance and what triggers it, the vehicle, any restrictive covenants and what happens if the firm is sold. Most senior construction hires receive an at-will letter. Ask for the missing terms before you resign, and have an employment attorney read it.
Suppose the offer is made over lunch in Tampa: a base, a truck, a bonus described as “a piece of what your jobs make,” and a handshake from a president you like. You start in March. Eighteen months later the backlog has thinned, the president’s son-in-law is running operations, and you are trying to recall exactly what was said about the bonus. Nothing went wrong on any single day. An employment agreement exists for that slow year and a half, and most senior people in construction never get one.
What is the difference between an offer letter and an employment agreement?
An offer letter states terms and usually says employment is at will, so either side can end it at any time. An employment agreement is a signed contract that can add a fixed period, severance and conditions for termination. Many contractors use only the letter.
At will is the default in most of the United States, and state law sets the exceptions. In practice it means the letter records what you are paid today and promises nothing about tomorrow. That is how most private firms hire, and plenty of project executives spend whole careers on two-page letters without trouble.
The trouble, when it comes, arrives the way it did in Tampa: slowly. Ownership changes, the market softens, a new operations head brings his own people. By the time you reach for the paper, the paper says a base salary and “eligible for a discretionary bonus.”
General information only, and not legal advice: the terms below are what to raise, and an employment attorney in your state is who should read the result.
What should a construction employment agreement cover?
Eight things: severance, the bonus formula, the vehicle, a definition of cause, the non-compete, the non-solicitation clauses, change of control and any repayment obligations. A senior hire will not win all eight. Knowing which are missing tells you what the handshake was standing in for.
| Clause | Why it matters | What to ask |
|---|---|---|
| Severance | At will means no notice and no pay unless written | How many months of base, and on which events? |
| Bonus | ”Discretionary” means optional for the firm | What is the formula, and is it owed if I leave before payout? |
| Vehicle | Personal use is generally a taxable benefit | Truck or allowance, and who carries fuel and insurance? |
| Cause | A loose definition empties the severance clause | Is cause limited to misconduct, with notice and a chance to cure? |
| Non-compete | It may limit your next job in the same metro | What radius, how long, and does it apply if I am laid off? |
| Non-solicitation | It can reach employees, clients and subcontractors | Does it bar using subcontractors I knew before I came? |
| Change of control | A sale can end your role or your equity plan | What happens to my bonus and severance if the firm is sold? |
| Repayment | Signing and relocation money may be clawed back | Does it reduce monthly, and is it waived if I am terminated? |
The vehicle is a pay term: the Internal Revenue Service treats personal use of an employer’s vehicle as a fringe benefit, generally taxable, so a truck and an allowance are not worth the same. And bonus wording decides more money than base does over five years. Our guide to negotiating an offer covers which terms move and which do not. Read the non-compete and non-solicitation terms with the project owner in mind too, because an owner’s job offer mid-project can collide with them. Get the paper signed before you give notice, because an offer rescinded after you resign leaves you holding only what was written down.
The clause that most often turns out to be absent is the first one on the list.
How much severance is reasonable, and what triggers it?
Federal law does not require severance. The Department of Labor describes severance pay as a matter of agreement between employer and employee. The amount is what you negotiate, usually in months of base pay, and the trigger matters more than the number.
Run the numbers as a worked example, on a base of $180,000. Severance of 3 months is $45,000, 6 months is $90,000 and 12 months is $180,000. The 3 and the 6 are the range a vice president or project executive can raise without the request seeming strange.
Severance “on termination without cause” protects you only if cause is tightly defined. Ask for a second trigger as well, resignation for good reason, which covers a material pay cut, a demotion or a forced relocation. Without it, the firm that wants you gone can halve your role and wait.
Expect conditions in return. Severance is normally paid only after you sign a release, and it may stop if you breach a covenant. Read both. “We take care of our people” is a sentiment, and sentiments are not assigned to the buyer when a firm changes hands.
Restrictive covenants and repayment clauses
Restrictive covenants are where an agreement takes something from you in return for what it gives. There are usually three: a non-compete, a non-solicitation of employees, and a non-solicitation of clients. Construction adds a fourth that surprises people, which is a bar on soliciting subcontractors. In one metro there may be six mechanical subcontractors able to do your work, and a clause that puts them off limits is a non-compete under another name.
Do not expect Washington to settle it. The Federal Trade Commission issued a rule in 2024 that would have banned most non-competes, a federal court in Dallas set it aside before it took effect, and its status has been contested since. The commission’s rule page carries the history. State law governs, the states differ sharply, and counsel in your state should read the covenant before you sign. Our note on non-compete terms goes through what can be narrowed.
Repayment clauses deserve the same care:
- Signing bonus. Ask for the repayable amount to fall month by month over the period. Our note on the sign-on bonus shows how an employer sizes one and ties it to a repayment agreement.
- Relocation. Ask that nothing is owed if the firm ends your employment without cause.
- Training or licensing costs. Ask for a cap and an end date.
- Equity or phantom units. Ask what a sale or your departure does to them, and read our piece on equity offers first.
What do you ask for when the firm does not do contracts?
Ask for the same terms inside the offer letter. A firm that will not sign an employment agreement will often add a severance paragraph, attach a written bonus plan and narrow a covenant in a two-page letter. The document’s title matters less than the signature on it.
“We don’t do contracts” is usually true and rarely the end of the conversation. The president is saying he does not want a twenty-page document from a law firm. He is seldom saying he will not write down what he just promised. Most firms know that a question left unanswered at this stage is how a senior offer gets declined, so a short, specific request tends to land well. Make it easy: send back a short list of the three or four terms that matter most and ask for them to be added before you give notice. If you have not resigned, you still have a job, and that is the strongest position you will hold in the whole process.
Offers for senior seats tend to be settled quietly, and often through a third party who can raise severance without it sounding like distrust. Selah Talent Partners does that inside confidential executive search for mandates that cannot be publicly posted, for construction firms throughout the United States. Candidates are never charged; a note through the candidates page is enough to begin.
Backlog thins slowly, and so does memory. Paper does neither.
Sources and further reading
- Severance pay, US Department of Labor
- Rule page, Federal Trade Commission, Non-Compete Clause Rule
- Fringe benefit, Internal Revenue Service, Publication 15-B